VANCOUVER – Kuya Silver Corp. [KUYA-CSE; KUYAF-OTCQB, 6MR1-FSE] said Thursday, June 17 it has raised $9.2 million from a bought deal private placement. Proceeds of the financing will be used to fund development activities at the company’s flagship Bethania silver mine in central Peru.
The Bethania mine was in production until 2016, toll-milling its ore at various other concentrate plants in the region. The company is planning to implement an expansion and construct a concentrate plant at site before restarting operations.
The private placement consisted of 4.8 million units priced at $1.90 per unit, and included the full exercise of an underwriters option to purchase an additional 15% of the offering units. Each unit consists of one common share of the company and one half of one common share purchase warrant.
Each unit entitles the holder to purchase one common share at an exercise price of $2.60 per a period of 24 months following the closing date. Kuya said it paid the underwriters a cash commission of $507,662.
On Thursday, Kuya shares eased 9.4% or 17 cents to $1.64 in light trading. The shares are currently trading in a 52-week range of $3.13 and $1.09.
The Bethania silver project is located in central Peru, in the northwestern part of the Huancavelica Department, approximately 316 km by road from Lima. The project encompasses four concessions covering 1,750-hectares that are accessible year-round via a four-hour drive from the city of Huancayo.
The mine produced silver-lead and zinc concentrates from the run of mine material until being placed on care and maintenance due to market conditions and lack of working capital.
In December, 2020, Kuya Silver acquired S&L Andes Export SAC, a Peruvian company that owns the mine and holds the mining concession, permits and other rights.
The company has received approval from the regional government of Huancavelica for the semi-detailed environmental impact study (EIA) for the Bethania processing plant project. The EIA approval covers a plant design for 350 tonne per day crushing, grinding and flotation circuits, as well as a tailings storage facility and ancillary infrastructure.
Kuya plans to implement an expansion and construct a concentrate plant at site before restarting operations in 2021.
Kuya’s other key asset is the Silver Kings project near the historic mining town of Cobalt,northeast Ontario. The project encompasses 10,000 hectares and consists of both Kuya’s 100%-owned Kerr Project and the Silver Kings joint venture that Kuya has entered into with First Cobalt Corp. [FCC-TSXV; FTSSF-OTCQB; FCC-ASX].
The Kerr Project at Silver Kings is located within a 900-hectare land package that includes several historic silver mines. Between 1905 and 1970, these mines produced over 50 million ounces of silver and 900,000 pounds of cobalt.
Although incredibly prolific, the deepest mine shaft in those operations was less than 200 metres, a scenario that provides an exceptional opportunity for deeper exploration, the company has said.